regional human development report on social inclusion

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Published by

United Nations

Development

Programme

Regional Bureau or

Europe and CIS

Bratislava 2011


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Copyright 2011

UNDP Regional Bureau or Europe and the Commonwealth o Independent States

All rights reserved. No part o this publication may be reproduced, stored in a retrievalsystem or transmitted, in any orm or by any means, electronic, mechanical, photocopying,

recording or otherwise, without prior permission.

This is an independent publication commissioned by UNDP. Its analysis and policy recom-

mendations do not necessarily reect the views o UNDP, its Executive Board or United

Nations Member States.

ISBN: 978-92-95092-31-0

The Social Exclusion Survey conducted or this report was cost-shared by the UNICEFRegional Oce or Central and Eastern Europe and the Commonwealth o Independent

States. The Survey was administered by TNS Slovakia.

Cover design and layout: Yassen Panov

Printing: Valeur (Slovakia)


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Report authors and data experts (in alphabetical order): Branka Andjelkovic, Andrey Ivanov, Balzs Horvth,

Sheila Marnie, Dotcho Mihailov, Susanne Milcher, Mihail Peleah, Tatjana Peric, Sevinc Rende, Max Spoor, PaulStubbs, Shahrbanou Tadjbakhsh

Contributors: Annie Demirjian, Monjurul Kabir, Jaroslav Kling, Piotr Krosniak, John Macauley, Koh Miyaoi, ClareRomanik, Kamil Wyszkowski

Critical readers: Balzs Horvth, Gina Lucarelli, Kori Udovicki, Jens Wandel

Peer review: Sabina Alkire, Rakat Hasanov, Eva Jespersen, Orsolya Lelkes, Gordana Matkovic, Roman

Mogilevsky, Milorad Kovacevic

Country teams:

Kazakhstan: Bakhyt Abdildina (coordinator), Ainur Baimyrza, Natalia Baitugelova, Kassymkhan N. Kapparov, and

Janar Jandosov;

Republic o Moldova: Iulia Sevciuc (coordinator), Petru Bogatu, Varvara Buzil, Viorica Craievschi-Toarta, DorinVaculovschi and Maria Vremis;

Serbia: Jelena Tadzic (coordinator), Marija Babovic, Slobodan Cvejic, Danilo Vukovic and Gazela Pudar;

Tajikistan: Rustam Babajanov (coordinator), Margarita Khegai, Saiullo Saarov, Mavjuda Yuldasheva and Kibriyo

Djumaeva;

The Former Yugoslav Republic o Macedonia: Magdalena Saldeva and Aerdita Haxhijaha Imeri (coordinators),

Jovan Ananiev, Petar Atanasov, Maja Gerovska-Mitev, Miroslav Shukarov and Aleksandar Stojkov;

Ukraine: Katerina Rybalchenko (coordinator), Anna Gvelesiani, Victor Kotygorenko, Yuriy Levenets, Ella Libanova,

Olena Makarova, Natalia Sitnikova and Tatyana Bolila;

Uzbekistan: Kakhramon Yusupov and Elena Danilova.

Language editor: Peter Serenyi

Project Board (in alphabetical order): Ann Marie Ali, Ilaria Carnevali, Matilda Dimovska, Balzs Horvth,

Sukhrob Khoshmukhamedov, Steliana Nedera, Kyoko Postil, Jens Wandel

Advisory board (in alphabetical order): Bakhyt Abdildina, Diana Alarcon, Gordon Alexander, Mahmood Ayub,

Ainur Baimyrza, Elena Danilova, Joost Delaat, Annie Demirjian, Adriana Dinu, Teresa Durand, Esther Forgan,

Elena Gaia, Petra Hoelscher, Kibriyo Jumaeva, Erika Kvapilova, Marie Laberge, Sheila Marnie, Koh Miyaoi, JoachimNahem, Simon Narbeth, Paola Pagliani, Ziyodullo Parpiev, Anuradha Rajivan, Lovita Ramguttee, Katerina

Rybalchenko, Magdalena Saldeva, Tim Scott, Iulia Sevciuc, Shombi Sharp, Ben Slay, Jelena Tadzic, Luis Francisco

Thais, Kori Udovicki, Moises Venancio, Louisa Vinton, Danilo Vukovic

Technical support: Michaela Matichova

Communications support: Zoran Stevanovic, Blythe Fraser

Authors and contributors


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eceived wisdom has avoured broad-stroke economic reorms or transition Eu-rope and Central Asia since the all o the Berlin Wall. Many have argued that priva-

tization and deregulation would unleash the productive energy o the market and

attract oreign capital. This advice was seen to bear ruit. Following the transition reces-

sion o the early 1990s, and especially ater the crisis o 1998, the region saw a decade o

broad-based and uninterrupted recovery. Livelihoods improved, and poverty declined onaverage in every country.

This report builds on evidence that, despite these gains, a signicant number o people in

transition Europe and Central Asia continue to eel dejected, and believe that their position

in society has declined. While some o these eelings may be rooted in the uncertainty thathas accompanied market relations and greater reedoms, something more undamentalis at play. Even in the decade o recovery and growth, inequalities continued to widen

especially between central and peripheral regions. The recovery ailed to lit signicant

segments o the population out o poverty. Many people ell urther behind.

Fundamental to this analysis is the concept o social exclusion. This report links the social

exclusion/inclusion paradigm, as developed in the European Union context, with the hu-man development paradigm, as articulated by Amartya Sen. It starts rom the premise

that people value not only consumable goods and services but also things that cannot

be consumedactivities and abilities that reinorce human dignity and sel-respect. For

example, we value employment not only because the income derived increases our pur-

chasing power, but also because it makes us eel like worthy members o society. Humandevelopment is about a growing number o people leading lives that they increasingly

value. Few o us, however, can engage in all that we value. We nd ourselves deprived in

one or another dimension. When deprivations accumulate, and especially when they start

to reinorce one another, social exclusion occurs.

This concept o social exclusion is broad and unabashedly relative. A deprivation occurs ian individual does not have the capability o consuming a basic basket o goods, or per-

haps even accessing the internet, when this is expected in his or her social environment.

While social exclusion is relative, this does not mean that it is subjective, in the sense that

individuals perceive themselves to be excluded. Exclusion takes place when people dont

have the capability o doing well-dened things.

The report emphasizes that social exclusion is not particular to any specic group. It can

happen to anyoneand it has happened to many in the turmoil o transition, given cer-

tain circumstances and policies (or their absence). At its extreme, social exclusion becomesmarginalization. This happens all too oten or groups, such as ethnic minoritiesespe-

cially Romaor or people with disabilities. However, this report does not equate socialexclusion with marginalization; nor does it associate social exclusion with specic groups.

The report captures the complexity o social exclusion through a multidimensional Social

Exclusion Index, a measure that is based on 24 types o deprivations. The Index is used to

quantiy and compare social exclusion in six countries in the regionranging rom Serbiato Tajikistan, with their dierent levels o development. The threshold at which the number

o deprivations amounts to social exclusion is a matter o denition, but the report shows

that the levels are signicant in all the countries under any plausible threshold.

More important, through ample analysis and numerous examples, the report illustrates

how social exclusion occurs, and how it can be countered through deliberate, inclusive

policies. For example, a deprivation such as low education level can interact with nationalor local policiesor example, the discontinuation o public transport connecting a vil-

R

Foreword

i


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lage to marketsto deprive an individual o employment. I no other amily member has asignicant source o income, this individual runs a high risk o being excluded. The report

also makes a convincing case that, in the absence o deliberate and inclusive policies, too

many people will become excluded, even i sustained growth returns.

The report presents evidence o the strong linkages between exclusion and local charac-

teristicssuch as the size and economic structure o the area, the degree to which the areais connected to a major economic centre, and the quality o the local environment. This

speaks to the marked spatial disparities in the region, especially between capital cities and

remote locations. Social inclusion requires the coordination o national and local policies,

and most importantly, needs a strong popular voice and participation in identiying theright policy choices.

The report argues that achieving social inclusion is easible, but it should be pursued sys-

tematically. It requires deliberate, comprehensive solutions that are tailored to specic cir-

cumstances, especially in diverse localities. It also argues that the tailoring is best done

when those who benet are included in the policy process. There is no silver bullet.

The global nancial crisis o 2008 has spelled an end to the relatively simple, broad-stroke,model o growth that had propelled many countries o the region in the previous decade.

Looking ahead, a return to sustained growth rates will require more ne-tuned govern-

ment policies aimed at greater competitiveness and productivity. In designing such poli-

cies, one should remember that peoples capabilities are our greatest resource. Growth

should ocus on enhancing those capabilities. A major component o the policy mix should

be the promotion o social inclusion. This will help to unleash the potential embodied inthe high levels o human capital that characterize the region.

Kori Udoviki

Assistant Administrator and Regional Director

UNDP Regional Bureau or Europe and the CIS


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iii

M

Acknowledgements:

the making o this report

any people have contributed to this Regional Human Development Report. Kori

Udoviki, Director o the UNDP Regional Bureau or Europe and the Common-

wealth o Independent States (CIS), andJens Wandel, Deputy Bureau Director and

Bratislava Regional Centre Director, deserve special thanks or their vision and support.

They enriched the process by giving crucial eedback, posing undamental questions, and

challenging several initial ndings.

Everyone involved deserves appreciation. The inclusive process behind the Report is worth

documenting, given its complexity. It started with a brainstorming and discussions at the

UNDP Regional Centre in Bratislava. Social inclusion was chosen as the subject o the Re-

port in order to respond to increasing government demand or evidence-based policyguidance on the topic. Dorothy Rosenberg and Sevinc Rende drated the concept note,and Susanne Milcher took on the role o project manager, detly steering the Report

through all phases o development.

The authors rst met in Bratislava in May 2009 or an inception workshop to discuss the

concept and numerous other issues. At this meeting it was agreed that Max Spoor would

be responsible or the economic dimensions o social inclusion, Shahrbanou Tadjbakhsh

or the links between human development and social inclusion; Branka Andjelkovic or

exclusion rom political lie; Tatjana Peric or exclusion rom cultural lie; Paul Stubbs or

exclusion rom social services and social assistance. Andrey Ivanov supervised the data

collection group that carried out the Social Exclusion Survey, which serves as the main

source o data or this Report.

The data collection group consisted oDotcho Mihailov (responsible or the sample de-sign and questionnaire), Mihail Peleah (responsible or the quantitative datasets, both

rom the Survey and secondary data), Sevinc Rende (who advised on the selection and

construction o indicators) and Jaroslav Kling (responsible or managing the contract

with TNS, the company that conducted the Survey).

In parallel, national teams were put together in the six countries covered by the Survey to

prepare background studies and conduct ocus groups meetings, the ndings rom which

contributed to this Report and to various National Human Development Reports. Bakhyt

Abdildina coordinated Kazakhstans country team. Magdalena Saldeva and Aerdita

Haxhijaha Imeri coordinated the team in the ormer Yugoslav Republic o Macedonia. Iu-

lia Sevciuc was responsible or the team in the Republic o Moldova. In Ukraine, the team

was coordinated by Katerina Rybalchenko, in Serbia by Jelena Tajic and in Tajikistan by

Rustam Babajanov. (The Social Inclusion Survey did not cover Uzbekistan, but researchled by Kakhramon Yusupov and Elena Danilova in Uzbekistan were reected in the Re-

port.)

In June 2009, the national teams met in Istanbul to agree on the methodology and to

discuss the data sources. Many o the inputs rom the national teams were used in the re-

gional analysis. The quotations that appear throughout the Report come rom ocus group

meetings conducted in each o the surveyed countries.

The national teams consulted extensively with local partners on the Social Exclusion Sur-

vey, the sampling, and the other aspects o the research. One criterion or selecting coun-

tries to participate in the Survey was that their national statistical oces would agree to

provide statistical data and accept the administration o an independent survey.

The Survey was conducted in the all o 2009. The national background papers were readyby March 2010. Then the Report authors met again at the Bratislava Regional Centre to

discuss the inputs and agree on the structure o the Report. In May 2010 Max Spoor con-


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iv

solidated the rst drat o the Report while Susanne Milcher integrated the results o theSurvey.

A thorough consultation and editorial process came next. In June-July, a group o peer re-

viewers (Rakat Hasanov, Orsolya Lelkes, Gordana Matkovic and Roman Mogilevsky)

provided detailed comments. The Project Board and the Advisory Board ollowed with

their own comments.

By August 2010 Andrey Ivanov had put together a second drat that buttressed the data

ndings with secondary source contextualization.Jaroslav Kling and Daniel Skobla con-

tributed to the quantitative data analysis and drated key text boxes, and Mihail Peleah

ran numerous recalculations and tests. They were assisted byJustin Kagin and ChristianBrueggemann.

The Report also beneted rom critical comments rom many colleagues. Within UNDP, An-

nie Demirjian provided valuable insights on the role o governments; Koh Miyaoi gave

ideas on how to strengthen the gender analysis; Monjurul Kabir and Clare Romanik

helped to nalize the local governance aspects; Dan Dionisie elaborated the links be-

tween corruption and social exclusion. Piotr Krosniakand Kamil Wyszkowski distilledthe experience o social enterprises in Poland. From outside UNDP, Milorad Kovacevic

made valuable comments on the statistical aspects o the survey and data analysis.

In November-December 2010 Balzs Horvth and Gina Lucarelli edited and streamlined

the Report, creating the third drat. Eva Jespersen and Sabina Alkire made a series oextremely helpul comments in January-February 2011. Peter Serenyi conducted a ma-

jor linguistic edit o the Report in February-March. Blythe Fraser and Giulio Quaggiotto

created the web platorm. Zoran Stevanovic, together with Andrey Ivanov, produced a

short documentary on homelessness in Russia. Finally, Michaela Matichova, Eunika Jur-

cikova and Veronika Kalousova provided invaluable administrative support.

In sum, the process benetted rom the contributions o many people. Everyone involved

has learned a great deal, and the hope is that the networks and partnerships established in

the process will continue to ourish. The authors thank all o those involved in the process,

while acknowledging sole responsibility or any errors ound herein.

All materials employed in the preparation or promotion o this Report (including back-ground papers, ocus groups reports, project descriptions and national reports) can be

ound at http://europeandcis.undp.org/poverty/socialinclusion.


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v

Table o contents

Foreword .................................................................................................i

Acknowledgements: the making o this report ......................iii

List o gures ...................................................................................... vii

List o tables ......................................................................................viii

List o boxes .......................................................................................viii

Executive summary ..........................................................1

Human development and social inclusion:key linkages ........................................................................... 1

Measuring social exclusion .............................................. 2

What the new methodology reveals ............................3

Recommendations ............................................................. 4

Chapter 1: Social exclusion, social inclusion,and human development ................................................7

Defnitions and terminology..................................................... 7

Human development:A people-centred approach ............................................ 7

Social exclusion: denied participation......................... 8

Social inclusion: expanding opportunities ................ 9

Social exclusion, social inclusionand human development .............................................10

Monitoring social exclusion ....................................................11

Dimensions o analysis ....................................................11

The social exclusion chain ..............................................12

Major fndings o this chapter.................................................14

Chapter 2: Dimensions of exclusionin the region ....................................................................15

Transition in the Europe andCentral Asia region ..........................................................15

Exclusion rom economic lie ..................................................16

Income poverty..................................................................17

Unemployment ..................................................................18

Access to assets and capital ..........................................20

Exclusion rom social services .................................................20

Early childhood, education and training,and lie-long learning ......................................................21

GDP per-capita, 2008 ......................................................21

Universal education? .......................................................22

Afordable health care? ...................................................23

Social protection ..............................................................24Housing and living conditions .....................................27

Access to Energy ................................................................28

Mobility and transportation ..........................................29

ICT and the digital divide ...............................................29

Exclusion rom social networksand civic participation .............................................................30

Civil society participation ...............................................30

Levels o trust, participation in civicnetworks and social capital ...........................................31


Chapter 3: The multidimensionalsocial exclusion measure ...............................................35

How to quantiy social exclusion?.........................................35

Level and depth o social exclusion in the region .............38

Structure o deprivation .................................................39

Social exclusion and the HumanDevelopment Index .........................................................42

Individual characteristics and theirimpact on social exclusion .............................................42

Limitations o the index ..................................................47

Major fndings o this chapter .................................................48

Chapter 4: Drivers of social exclusion ...........................49

Structures and institutions as driverso social exclusion and inclusion ..........................................49

The legacies o the past ..................................................49

Institutional transition and governance ...................51

Rule o law and social inclusion ...................................53

Labour market institutions ............................................53

Policies as drivers o social exclusion or inclusion ............55

Growth models .................................................................55

Social policies as drivers .................................................58

Decentralization policies as drivers ............................59

Values and behavioural patterns as driverso social exclusion .....................................................................60

Gender ..................................................................................61

Minorities .............................................................................62

Alienation and withdrawal rom society .................65


Chapter 5: The local contextand social exclusion........................................................67

The local context........................................................................67


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Mono-company towns versusthe knowledge economy ...............................................67

The impact o environmental disasterson social exclusion ...........................................................68

Individual risks and local context..........................................69

Food and housing risks ..................................................69

Local schooling ..................................................................70

Tolerance o corruption ................................................72

When local context aggravates individual risks ...............72

Disability and the local context ..................................73

Education, location and job prospects ......................73Age, location and environmental disasters ............ 74


Chapter 6: Towards inclusive societies .........................75

Main conclusions o the report...............................................75

Recommendations: the strategy level..................................76

Genuine policy commitmentto social inclusion ..............................................................77

Learning rom experiencein the European Union ....................................................79

Towards pre-emptive policies: decreasingindividual risks to social exclusion.........................................80

Inclusive social services ..................................................80

Education, health and basic servicesaccessible to all ..................................................................80

Improving the employabilityo the labour orce ............................................................81

Revisiting social protection ...........................................82

Services or the elderly ....................................................83

Child benets .....................................................................83

Social services or vulnerable amilies .......................84

Unemployment benets ................................................84

Turning drivers o social exclusioninto drivers o inclusion ...........................................................84

Towards inclusive institutions ......................................85

Dening an appropriate role or the state ..............85

Improving government efectiveness ......................85

Local councils and inter-municipalcooperation .........................................................................86

Building social capital ......................................................86

Economic policies or inclusive growth ....................87

Redening growth in a humandevelopment context ......................................................87

Diversiying growth opportunities ............................87

Optimizing the scope o governmentinvolvement in economic activity ..............................88

Changing mindsets: towards tolerant societies.................88

Realistic approaches to anti-discrimination ........... 88

Inclusive education and labour markets ..................89

Fine-tuning policies to the local context..............................90

Strengthening community capacitiesand integrative social planning ...................................90

Individual entrepreneurshipand sense o community ...............................................90

Integrating monitoring and evaluation intothe social inclusion policy process.........................................91

Evidence-based policies,data and indicators ...........................................................91

A sub-regional open method o coordination .......91

Methodological annexes ...............................................93

Annex 1: Social Exclusion Survey (2009) ..............................93

Methodological note .......................................................93

1.1. Background .................................................................93

1.2. Coverage and timing ...............................................93

1.3. Unit o observation and analysis,sample size and sampling method ...........................94

1.5. Characteristics o the sampling clusters ...........95

1.6. Qualitative aspects o social exclusion ..............95

Annex 2: Multidimensional social exclusionmeasurement..............................................................................96

2.1. Construction o the indexand selection o the indicators ....................................96

2.2. Robustness checks o indicatorsor the Social Exclusion Index ......................................98

2.3. Constructing the multidimensionalSocial Exclusion Index .................................................. 101

2.4. The selection o thresholds................................. 102

2.5. Regional averages weighted or unweighted? ........................................... 103

Annex 3: Social exclusion profleso individual countries ...........................................................106

Annex 4: List o abbreviations.............................................. 108

Bibliography ................................................................ 109


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List o gures

Figure 1.1: The relationship between humandevelopment, social exclusion and social inclusion ............10

Figure 1.2: The social exclusion chain ....................................13

Figure 2.1: GDP per-capita trends 1990-2008(as percentage o 1990 values) ...............................................15

Figure 2.2: Employment ratios (in percent), 1990-2008 ...16

Figure 2.3: The Human Development Index, 1990-2007..16

Figure 2.4: Income inequality as measuredby the Gini coecient, 1989-2005 .............................................16

Figure 2.5: Income versus inequality, 2005 ...........................17

Figure 2.6:The percentage o households withper capita consumption below three poverty lines ............17

Figure 2.7: Percentage o children living inhouseholds with daily per capitaconsumption below 2.50 US$ PPP in 2005 .............................18

Figure 2.8: Unemployment rates o the workingage population (15-64) in Serbia ...............................................19

Figure 2.9:The percentage o children enrolledin pre-school rises with income ..................................................21

Figure 2.10: Government health expenditure asa percentage o GDP (1995-2008) ..............................................22

Figure 2.11: Share o respondents sayingunocial payments are neededor medical treatment (in percent) .............................................24

Figure 2.12: Number o children in institutional

care per 100,000 people 18 years or younger (2006) ..........26Figure 2.13: Percentage o urban and ruralpopulations living in dwellings not connectedto a public water network, 2005-2006 ......................................27

Figure 3.1: Composition o the economicdimension .........................................................................................39

Figure 3.2: Composition o the socialservices dimension ..........................................................................40

Figure 3.3: Composition o the civic dimension .................40

Figure 3.4: Social exclusion is the product oa wide range o deprivations .......................................................41

Figure 3.5: Human development and social exclusion .....42

Figure 3.6: Social exclusion and age ........................................43

Figure 3.7: Location matters .......................................................44

Figure 3.8: Employment is critical or avoidingsocial exclusion .................................................................................45

Figure 3.9: Good education matters .......................................45

Figure 3.10: Vulnerable groups and social exclusion ........46

Figure 3.11: Similar levels o social exclusionbut diferent structures ..................................................................47

Figure 3.12: Actual exclusion is diferentrom perceived exclusion ........................................................47

Figure 3.13: Social exclusion correlates withpeoples dissatisaction with their living standards .............48

Figure 4.1: Connections mattered thenand matter now ................................................................................50

Figure 4.2: Diferences in governanceacross the region .............................................................................51

Figure 4.3: Efective governance reducessocial exclusion .................................................................................52

Figure 4.4: ...So does a riendly business environment .....52

Figure 4.5: Improved rule o law mitigatessocial exclusion .................................................................................53

Figure 4.6: Disappointed by transition ...................................54

Figure 4.7: Insecure employment and social exclusion ....55

Figure 4.8: Labour market institutionsoster social inclusion......................................................................55

Figure 4.9: The questionable benets o inormalemployment ......................................................................................57

Figure 4.10: Declining solidarity goes hand

in hand with social exclusion .......................................................59Figure 4.11: Should children with disabilitiesattend mainstream schools? ........................................................64

Figure 4.12: What school should childrenwith disabilities or HIV attend? ....................................................64

Figure 4.13: Share o people who have experiencedprejudice in the past three months ...........................................65

Figure 5.1: Multiple employment opportunitiesdecrease the risk o social exclusion ..........................................67

Figure 5.2: Areas with multiple employersare more resilient to crisis ............................................................68

Figure 5.3: Better inrastructure promotessocial inclusion ..................................................................................69

Figure 5.4: Environmental disasters contributeto social exclusion in three dimensions ...................................69

Figure 5.5:The risk o hunger, and eviction persists ..........70

Figure 5.6: Subsistence agriculture helpsto decrease exclusion .....................................................................70

Figure 5.7: Social exclusion leads to inerior education... 71

Figure 5.8: but how much so depends on location .......71

Figure 5.9: Social exclusion is lowerin communities that do not tolerate corruption ...................72

Figure 5.10: Disability increases the risko social exclusion, but not universally .....................................72

Figure 5.11: Individual risks and local specics

interact to produce social exclusion .........................................73Figure 5.12: Youth and the elderly living in villages areespecially vulnerable to social exclusion .................................74

Figure A.1: Diferent thresholds but a similar outcome. 102

Figure A.2: Testing the robustness o the adjustedsocial exclusion headcount, M0 or cut-ofs k..................... 103

Figure A.3: Social exclusion headcount - regional averages(population-weighted and non-weighted) ......................... 104

Figure A.4: Average deprivation index - regional averages(population-weighted and non-weighted) ......................... 104

Figure A.5: Multidimentional Social ExclusionIndex - regional averages(population-weighted and non-weighted) ......................... 105

Figure A.6: Social exclusion and age .................................... 105


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viii

List o boxes

List o tables

Box 1: UNDPs body o research onsocial exclusion and social inclusion ...........................................9

Box 2: A rights-based approach to social exclusion the what, who and how o social inclusion.............................11

Box 3. The denition o the region ............................................15

Box 4: The homeless .......................................................................28

Box 5:The ties that bind ...............................................................32

Box 6: The EU approach to measuring povertyand social exclusion.........................................................................35

Box 7: Promising approaches to collecting dataon social exclusion ...........................................................................36

Box 8: What it means to be deprived:Clariying the survey methodology ...........................................37

Box 9: Social exclusion in Central Asiaand the impact o legacies ............................................................50

Box 10: Inuencing local policiesthat impact women in Albania ....................................................61

Box 11: Inclusion in community structures versusthe individual right to choose in Tajikistan .............................63

Box 12: Social Exclusion o people living with HIVin Eastern Europe and the CIS ......................................................65

Box 13: Adults and Children with Disabilities ......................73

Box 14: How the European Union seeksto achieve social inclusion ............................................................78

Box 15: Social enterprise:U Pana Cogito Inn in Poland......82Box 16: Conditional cash transerscan promote social inclusion .....................................................83

Box 17: The Shared Society Project ...........................................86

Box 18: Social inclusion in Turkey:the Dreams Academy project ......................................................89

Table 2.1: Spatial distribution o consumptionpoverty (1998-2003) (in % o population) ...............................18

Table 2.2: Percentage o peopleby employment status (November 2009) ...............................19

Table 2.3: Lack o Access to Utilities (in %).............................27

Table 2.4: The percentage o peoplewho cannot aford electronic equipment ...............................29

Table 2.5: Percentage o people who disagree withthe statement: Most people can be trusted. .......................31

Table 3.1: Social exclusion in the six surveyedcountries ..............................................................................................38

Table 3.2: Sources o social exclusion or Roma,IDPs and the general population in Serbia(percentage contribution o each dimensionto social exclusion by group) .......................................................46

Table 4.1: Adapting to a new lie in Ukraine .........................54

Table 4.2: Ocial aid and remittances ....................................56

Tables in Annexes

Table 1. Survey respondents by country and sex .............94

Table 2. Indicators or the multidimensional socialexclusion index and distribution o populationby indicator and country ...............................................................96

Table 3. Factor loadings (pattern matrix)and unique variances ......................................................................98

Table 4. Partial correlation matrixes ...................................100

Table 5. Final working sample or the constructiono the Social Exclusion Index ..................................................... 101

Table 6. Testing the robustness o the Social

Exclusion Index or cut-of threshold k = 9........................... 103Table A.7: Social exclusion and education .......................... 105

Table A8: The contribution o individual deprivations ... 106


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nderstanding the concept o so-

cial exclusion is critical or assess-ing the transormations that have

taken place in the post-socialist countrieso Europe and Central Asia (ECA).1 Social ex-

clusion deprives people o the opportunity

to participate in economic, social and civic

processes, and limits their ability to lead

productive, creative lives in accordancewith their needs and interests. Socially ex-

cluded persons nd themselves conned to

the ringes o society. To paraphrase Adam

Smith, they are not able to appear in pub-

lic without eeling shame. Social exclusion

occurs in part because growth does not al-ways translate into increased job opportu-

nities, improved social services, and greater

opportunities or civic participation.

The changes that ollowed the collapse othe socialist system have undamentally

redened peoples lives, values and be-

haviour. Transition has brought reedoms

and choices to many, but deprived many

others o the ability to live long, healthyand productive lives. These deprivations

have wider social consequences. When a

medical commission in Moldova rejects a44-year-old womans application to work

on the grounds that she has rheumatic ar-thritis; when a municipality in Kazakhstan

denies a rural resident the chance to com-

mute to work by cancelling a bus route; or

when schoolchildren in the ormer Yugo-

slav Republic o Macedonia shun an orphanbecause they think she is dirty, society as a

whole loses. Not only do the victims suer

increased risk o social exclusion, but also

society experiences a loss o human re-

sources and productive gains. I high levels

o social exclusion lead to increased socialtensions, society must also count the cost

U

1

1/For the purposes o this

report, the ECA region or

simply the region reers

to the ormer socialist coun-

tries that have undergone

a dramatic political and eco-

nomic transormation since

1989-1991. This report does

not explicitly reer to Cyprus,

Malta and Turkey which

are also covered by UNDP sRegional Bureau or Europe

and the Commonwealth o

Independent States as

they do not share the social-

ist legacy or the experience

o transition. However, the

reports underlying analyti-

cal ramework and many o

its conclusions are relevant

or these countries as well.

Executive summary

o added social protection, policing and

prisons. A society with higher levels o so-cial exclusion is not only less vibrant and

cohesive, but also less sae, productive anddynamic. Devoting eorts and additional

resources to enhancing social inclusion

ought thereore be a critical policy priority.

Human development andsocial inclusion:key linkages

This report conrms that income-based

measures o poverty are insucient or cap-turing the depth and breadth o the depri-

vations in the region today. Analysing the

transormations through the broader prism

o human development becomes critical.

Human development assesses peopleswell-being beyond income and includes

peoples ability to live long, healthy and

creative lives; to advance other goals which

they have reason to value; and to engage

in shaping development equitably and sus-tainably on a shared planet.

This report integrates the social inclusion

and human development two people-

centred concepts that governments in-creasingly view as integral or addressing

persistent poverty and shortalls in educa-

tion and health. While human development

is recognized as the goal o development,

social inclusion is important because, as a

process or removing the obstacles pre-venting people rom realizing their capa-

bilities, it oers a map or how policy can

be employed to achieve higher levels o hu-

man development.

Given that people are the centre o devel-opment, this report breaks new ground by


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2

looking at social exclusion rom the per-

spective o risks aced by individualsrath-

er than risks aced by vulnerable groups. Akey message o this report is that anybody

can be excluded. We assume that individu-

als have a number o characteristics thatcan put them at risk o social exclusion. We

dene those characteristics as social exclu-sion risks. Being disabled, a workaholic, or

inadequately educated are just a ew char-

acteristics that can put a person at risk o

social exclusion.

Not all risks produce social exclusion.

Whether social exclusion occurs depends

how risks interact with drivers such as in-

stitutions, norms, policies and behaviours.

For example, anti-discriminatory legisla-tion can decrease a disabled persons risk

o social exclusion. Legislation banning gay

marriage increases a homosexual couples

risk o social exclusion. Peers who dont

value knowledge increase the risk o social

exclusion or a bright child who is willingto study. These are just a ew examples il-

lustrating a larger theme: social exclusion

is not just a problem or disadvantaged or

marginalized populations. It is a concern

or everybody, as everybody aces risks.

The local context also inuences individual

risks. Local actors that could augment in-

dividual risks and aect social exclusion

include available employment opportuni-ties, distance to urban centres, the state o

basic inrastructure, or whether a locality

has been hit by conict or environmental

degradation or both. Individual risks could

result in social exclusion i a member o themajority population lived in an area domi-

nated by an ethnic minority, particularly

i that locality had a history o ethnic con-

ict. Likewise, a person who works to ght

corruption yet whose mayor takes bribes

might nd that his risk o exclusion couldbe higher.

The report addresses the process o social

exclusion in its entirety, integrating the in-

dividual vulnerabilities and risks, the driv-ers o exclusion and the specics o the

local context into a comprehensive social

exclusion chain. Addressing its individual

components only will not bring about tan-

gible and lasting results. In order to achievesocial inclusion, concerted interventions

targeted at the entire social exclusion chain

are necessary.

Measuring social exclusion

The report not only advances the concept

o social exclusion, but also proposes a new

approach or quantiying it. The approach is

reected in the Multidimensional Social Ex-clusion Index, which captures the complex

nature o social exclusion. It is based on the

multidimensional poverty methodology o

Alkire and Foster which has been employed

in UNDPs 2010 Global Human Develop-ment Report. The index assesses the status

o people and their households along three

dimensions: economic exclusion, exclusion

rom social services, and exclusion rom civic

participation. The social exclusion index em-ploys 24 indicators eight or each dimen-

sion that reect the ways in which people

are denied access to labour markets, educa-

tion and health systems, as well as to civic

and social networks. An individual is denedas socially excluded i he or she is deprived

in at least nine indicators. Since a dimension

contains only eight indicators, to be consid-

ered socially excluded a person must be de-

prived in at least two dimensions. The indexreects both the share o people that experi-

ence at least nine out o 24 deprivations, and

the depth (how many deprivations socially

excluded people experience on average).

The report then applies this methodologythrough nationally representative house-

hold surveys that were conducted in 2009 in

the ramework o a regional survey,2 herea-

ter reerred to as the Social Exclusion Survey.

Some 2,700 persons were surveyed in eacho six countries: Kazakhstan, the Republic o

Moldova, Serbia, Tajikistan, the ormer Yu-

goslav Republic o Macedonia, and Ukraine.

Such analysis is important because in order

to design more socially inclusive policieswe must rst understand the breadth and

depth o social exclusion.The Multidimensional Social Exclusion Index

introduced in this report is relevant beyond

the six countries covered by the survey. Themeasurements can be adapted to national

circumstances. The indicators selected are

not etched in stone; rather, they are intend-

ed to be a point o departure or national de-

bates on how best to measure social exclu-sion. Nationally relevant indicators should

be selected in an inclusive and participatory

way. The index can also contribute to EU-

level analysis o social exclusion, which has

ocused mainly on income-based measureso poverty and social exclusion.

2/ The survey, which was

carried out in 2009, was

cost-shared by the UNICEF

Regional Oce or Central

and Eastern Europe and the

Commonwealth o Inde-

pendent States. In Serbia

the survey sample included

internally displaced persons

as well as members o

the Roma minority. The

survey was carried out by

TNS Slovakia and its local

branches in the countries

covered and employed the

same methodology or allcountries, thus permitting

cross-country comparisons.

Qualitative inormation

rom ocus-group discus-

sions and individual

interviews with vulnerable

groups complement the

quantitative data and

provide valuable insights

into the experiences o

socially excluded persons

that are dicult to capture

through traditionalsurvey techniques. Finally,

important inormation

comes rom seven country

studies (carried out in the

six surveyed countries and

in Uzbekistan). These have

been prepared in close

consultation with national

stakeholders (government,

civil society, academia)

who helped to shape both

the regional and country

reports.


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3

What the new methodologyreveals

This methodology shows that social exclu-

sion is pervasive in the Europe and Central

Asia region. According to the analysis, one

out o every three persons is socially exclud-ed. One out o 10 is socially excluded in the

ormer Yugoslav Republic o Macedonia,

while seven out o 10 is socially excluded

in Tajikistan. Furthermore, the report con-

rms the hypothesis that economic indica-tors o social exclusion only partly explain

this phenomenon. Two other actors lack

o access to social services, and lack o ac-

cess to civic and social networks contrib-

ute equally to social exclusion.

Diverse headcounts but similar patterns

Surprisingly, the analysis reveals that, de-

spite the diversity o the region, the depth

o social exclusion is remarkably similar

across the six countries surveyed. In otherwords, a person in the ormer Yugoslav

Republic o Macedonia aces the same in-

tensity o social exclusion as a socially ex-

cluded person in Kazakhstan. The analysis

also suggests that people across countriesadopt similar coping strategies to deal with

their exclusion.

The report also nds that jobless growth,

which has characterized the region in recent

years, has created a layer o discouragedworkers (particularly women and middle-

aged persons) who have had to take jobs

in the inormal sector. Such shadow econ-

omy employment ails to provide health or

pension benets, the lack o which can leadto poorer education, health and nutrition.

Vicious cycles can result. Lower education

levels can lead to diminished job oppor-

tunities. Lack o transportation in remote

villages can lead to a diminished ability totake part in political decision-making to ad-

dress the lack o transport. Such processes

can create an entrenched underclass, such

as we see with Roma.

According to the survey, people dont trusttheir neighbours. Nor do they trust govern-

ment institutions, which are supposed to

protect their interests. They increasingly

rely on inormal channels, a practice that

diminishes transparency and may encour-age corruption. Such patterns hinder eec-

tive and responsive public administration

a prerequisite or inclusive societies.

Who are most at risk o exclusion?

Applying the methodological rameworkdescribed above and the social exclusion

measurements, the report goes beyond

an aggregated headcount o excluded

populations and brings the reader closerto answering the question, Who are the

socially excluded? The data suggest that inthe case o elderly persons, children, youth,

rural dwellers, and o the unemployed and

undereducated, the probability o individ-

ual risks leading to social exclusion is much

higher than or the population as a whole.The elderly experience levels o social ex-

clusion that are oten twice as high as or

the country as a whole. In Ukraine, or ex-

ample, social exclusion among the elderly

is 43 percent, some 23 percentage pointshigher than the national average. In the or-

mer Yugoslav Republic o Macedonia, social

exclusion among the elderly is 22 percent,

some 10 percentage points higher than the

national average. On average, 42 percento children (aged 0-15) and 35 percent o

youth (aged 15-29) live in households that

are socially excluded in the six countries.

The share o socially excluded children is

particularly high in Tajikistan (73 percent)and the Republic o Moldova (47 percent).

Worryingly, children experience the deep-

est levels o social exclusion.

Likewise, social exclusion among the un-

employed is substantially higher than orthe population as a whole. Social exclusion

among jobless workers is 12 percentage

points higher than among the rest o the

population in most countries o the region.

The rate o social exclusion among peoplewith low levels o education is two times

higher than the overall rate o social exclu-

sion in Ukraine, Serbia and the ormer Yu-

goslav Republic o Macedonia.

The social exclusion index does not indi-cate signicant gender dierences among

the socially excluded, but this doesnt

mean that women and girls are immune to

higher social exclusion risk. The absence oa signicant dierence can be attributed

to the way the index was constructed, as

it was largely based on household-level

deprivations which do not actor in intra-

household gender disparities.

While people in all six countries ace a

broadly similar depth o social exclusion

on average, members o some groups aremore deprived than others. Such groups


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4

can be dened both by ethnicity (such as

Roma) or status (internally displaced per-

sons, reugees, the homeless). In Serbia, thesurvey was expanded to include Roma and

internally displaced personswith striking

results. The magnitude o social exclusionamong Roma is 86 percent, and 56 percent

among internally displaced persons, com-pared with 19 percent or the rest o the

population.

The role o values

The report suggests that values and behav-iour matter. The data permit us to correlate

the exclusion o people with disabilities

with the local communitys tolerance or

diversity. When a person with disabilities

lives in a community that tolerates inclu-

sive education, the magnitude o exclusionis only 16 percent. However, this gure rises

to 30 percent when the community is less

open to inclusive education. By contrast,

tolerance o corruption worsens exclusionoutcomes. The magnitude o social exclu-

sion is nine times higher in villages and

seven times higher in small towns where

the majority o respondents tolerates inor-

mal payments.

Spatial aspects o social exclusion

and mono-company towns

Social exclusion has clear spatial dimen-sions. The arther people live rom urban

centres, the greater the social exclusion. Thepercentage o socially excluded persons in

rural areas is almost our times that o per-

sons in urban areas. Living in rural areas is

a massive disadvantage. With ewer job op-

portunities and networks and less access togoods, social services and transport, many

rural dwellers choose to migrate to urban

areas, a phenomenon that does not always

benet society at large.

The report nds that social exclusion ishighest in communities that had been

dominated by one or two companies prior

to 1989. This is an important issue. The Rus-

sian Federation, or example, has desig-

nated 335 towns as mono-company towns,with a combined population o 16 million

people. Our data show that i such commu-

nities were to diversiy their economic base

and provide more employment opportuni-

ties, the average magnitude o social exclu-sion they experience would decrease rom

18 to 11 percent. This would be particularly

eective or addressing social exclusion

among young people. The magnitude o

social exclusion or a young person with

secondary education in a rural community

with only one employer is more than threetimes higher than or a young person with

primary education in a small town with

multiple employers.

Recommendations

To reduce social exclusion, governmentsshould oster increased employment op-

portunities, particularly where people live

in mono-company towns. Furthermore,

policy makers would do well not only to

boost the number o employers but also toincrease social services and avenues or po-

litical representation. Local development

strategies need to consider such activities

when embarking upon employment gen-eration programmes.

Furthermore, governments should address

the three dimensions o social exclusion

exclusion rom economic lie, rom social

services, and rom civic lie and networks

in an integrated manner. Simply reducingincome poverty or addressing one indi-

vidual risk or driver will not eradicate social

exclusion. Instead, multiple interventions,

implemented in a concerted manner, re-

ecting the complexity o the problem, are

needed.

Policy commitment with clear targets

There is a need or a long-term policy com-

mitment to social inclusion. Social inclu-sion should be as high on policy agendas

as economic growth or poverty reduction.

As a rst step, governments need to adoptwell-dened strategies or combating social

exclusion, with clear responsibilities and adesignated lead agency. The experience o

EU member statesalthough developed

and tested in a dierent economic and po-

litical contextcan be useul in that regard.Political will is also necessary to implementevidence-based policies with clear social

inclusion targets and measurable indica-

tors.

Political commitments need to be matched

by well-dened targets and transparentmonitoring based on relevant indicators.

Without the accountability stemming rom

using such targets and progress indicators

in a robust and independent monitoring

and evaluation system, social inclusion will

remain a slogan. The indicators proposed inthis report can act as guiding examples and


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5

starting points or developing and urther

tailoring indicators to national and sub-

national contexts.

Preventive ocus on individual vulnerabilities

Addressing individual risks that make peo-ple vulnerable to exclusion beore those

risks translate into social exclusion shouldtake place in two areas that complement

and reinorce each other. The rst encom-

passes the entire range o social services

that improve individuals capacity to re-

spond to exclusion risks. The second arealargely alls under social protection and so-

cial saety nets.

Basic services should be accessible to all.

They should be appropriate, adaptive and

exible. The provision o quality and ac-cessible education, health, housing, water,

sanitation and transportation services is

vital to break the intergenerational cycle

o social exclusion in the region. Improving

access to these services or all is a prereq-uisite or addressing inequality and social

exclusion.

Accessible education that adapts to the

changing economic and social environment

is particularly important in the context osocial inclusion. Educational systems per-

ormance outcomes materialize over gen-

erations. In the region, the achievements othe previous system are oten perceived as

given which they are not. In act, whilethe post-transition averages do not place

the region behind other regions o similar

development levels, these countries were

distinctly ahead in such comparisons two

decades ago. Moreover, some countrieshave gone through a marked absolute

worsening. Understanding the momentum

o the educational systems and their po-

tential role in the social exclusion chain is

crucial or social inclusion. Social policies are not currently ullling

their potential to promote social inclusion.

A legacy o category-based social protec-

tion and a combination o legalism in terms

o ormal rights and discretion in the ront-line bureaucracy, along with stigma, dis-

crimination and ormalistic approaches led

to increasingly poorly targeted benets.

A good short-to-medium-term approach

would be to ocus on universal child ben-ets and the provision o quality social ser-

vices and adequate social pensions. Much

could be achieved within the existing scal

envelope, i the reallocation o resources

were based on sound rst principles, ocus-

ing on actual needs and eective impact

monitoring.

Employability and inclusive markets

matter. An important way to promote both

employment opportunities or popula-tion groups at risk o social exclusion anda mindset change in society at large is to

improve the employability o the labour

orce through improved vocational edu-

cation, active labour market policies and

through developing or strengthening thesmall-scale private sector, including the so-

cial economy.

Clear ocus on peoples capacities

For social inclusion policies to yield results,

they need to aim or changes in norms andinstitutions to enable them to identiy and

expand peoples capacities and opportuni-

ties. The report argues or inclusive institu-

tions, education and labour market policies

to support inclusive, diversied growthand to help change mindsets. These would

gradually change the drivers o social exclu-

sion to begin acting as drivers or inclusion,

and raise tolerance in society.

Governments have a clear responsibilityor dening and enorcing equal rules o

the game and preventing market ailures.

For that purpose, improving the quality ogovernance is highly important and entails

improving accountability, strengtheningnational institutions and increasing their

transparency, thereby decreasing corrup-

tion. It also entails increasing the govern-

ments eectiveness in the provision o

public services. These steps would bridgethe gap between citizens and the state

making the ormer more willing to iden-

tiy withand be part o, included inthe

scope o activities o the latter.

People and their well-being are the ulti-mate objectives o economic development.

It is o utmost importance that any model

o development needs to be more oriented

towards sustainable sources o growth and

less concentrated in the capital cities. Onlythen can growth markedly reduce the mag-

nitude and depth o social exclusion.

Diversiying development opportunities

is a critical dimension o inclusive growth.

It entails policies that increase the chancesor starting small- and medium-sized enter-

prises, decrease the dependency o localauthorities on central transers while giving


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6

them more responsibility or budget use,

and strengthening mechanisms to make

them accountable to local populations;stimulate local economic development,

and crowd in private investment by pro-

viding an improved business climate, inra-structure, and communication.

Deliberate eorts to change mindsets

Even the best-crated policies will not do

much unless they resonate with the expec-

tations o responsive and supportive con-

stituencies. To have lasting positive eect,policies need to be communicated to the

public and the public needs to see them

as legitimate and in societys interest. Seen

rom that perspective, changing mindsets

towards universally accepted values has

immediate policy relevance. Values haveshited during transition. For example, in

Central Asia the wholesale rejection o the

previous systems values is resulting in a

return to traditional gender and culturalnorms, which can create new sources o

exclusion or women. Decreasing levels o

solidarity in combination with intolerance

to diversity can result in increasing discrim-

ination against ethnic minorities, personswith disabilities, people with dierent sex-

ual orientation, people living with HIV, and

ormer prisoners. Two additional eatures

stand out:

Changing mindsets requires long-term

approaches. These include strengthening

comprehensive anti-discrimination laws,policies and institutional mechanismsbased on respect or human rights, dignity

and reedom matched by implementation

capacity. Weak legal rameworks and insti-

tutions result in low levels o acceptance o

inclusive measures (such as inclusive edu-cation), and hence also need to be targeted

by policies.

Changing mindsets in minority popula-

tions is also important. Inclusion is a two-

sided process in which both the excluded

and the majority population must acceptand accommodate the characteristics o

the other.

Implementing these recommendations

will not guarantee success. The process willdier rom country to country. But apply-

ing the policies outlined in this report will

bring us one step closer to a more ecient

and sustainable societyone where peo-

ple can realize their ull potential.


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7

his chapter introduces the termi-nology o the report. Drawing on

the denitions used by the Euro-

pean Union (EU) and UNDP, it denes so-

cial exclusion, social inclusion and human

development. It then links these three con-cepts, articulating a single ramework or

social exclusion and human development

in the Europe and Central Asia region.

Denitions andterminology

This report views social exclusion and socialinclusion through a human development

lens, which emphasizes the expansion o

peoples reedoms to live long, healthy

and creative lives; to advance other goals

they have reason to value; and to engageactively in shaping development equita-

bly and sustainably on a shared planet.3

Human development is both about status

(the achieved level o development) and

process (the kind o development that ispeople-centred, where people are the ben-

eciaries and also the agents o change

both as individuals and as groups).

Human development:A people-centred approach

2010 marked the 20th anniversary o the hu-

man development concept, which serves asthe analytical ramework or UNDPs global,

regional and national human developmentreports (HDRs). Since the human develop-

ment paradigm was rst articulated in the

1990 Human Development Report, thelanguage, examples, and policy recom-

mendations have developed, but the ocus

has remained on peoples lives, reedoms

and capabilities.4 People are the benecia-

ries o development, as well as the agentswho can improve their lives. Resources,

incomes, institutions, as well as political or

social guarantees, are all important policy

goals. Ultimately, however, success must be

dened in terms o the lives people lead,and the capabilities they possess.

The key aspects o human developmentare not xed. This exibility enables the hu-

man development concept to be applied in

both developing and developed countries

and to be tailored to dierent national con-

texts.

People are the real wealth o a nation. The

basic objective o development is to create an

enabling environment or people to live long,

healthy and creative lives. These were theopening words o the 1990 Human Devel-opment Report. The 1991 Human Develop-

ment Report rened the concept in a simple

sentence: The real objective o developmentis to increase peoples choices. Additional

choices include political reedom, guaran-

teed human rights and sel-respect whatAdam Smith called the ability to mix with

others without being ashamed to appear

in public. It also argued that to advance

human development, economic growth

ought to be participatory, distributed well,and sustainable.

The human development paradigm em-

phasizes two simultaneous processes: the

ormation o human capabilities and theuse to which people put them. It is there-ore a destination, a goal or social and

political processes, as well as a roadmap. It

reers to the processes and the outcomes o

development as the expansion o peoples

choices, capabilities and reedoms.

The absence o public services, such as so-

cial assistance, health care, education and

law enorcement, may increase vulnerabili-

ties and limit choices. Authoritarian regimes

can violate political and civil rights and im-pose restrictions on peoples reedom to

participate in the social, political and eco-

nomic lie o the community.5 These restric-

T

Chapter 1: Social exclusion, social

inclusion, and human development

4/See Alkire (2009) or

a ull discussion o the

evolution o the Human

Development Reports.

3/UNDP 2010b: 22.

You talk to a person, it seems like you are already riends and sud-

denly you hear Excuse me, you are in a wheelchair and I cannot

invite you to my bir thday party you know, you are in a wheelchair.

Or I ask a neighbour to help me go outside and he says Am I your

servant who helps you go outside? (24-year-old man with a disabil-

ity, urban area, The Republic o Moldova)

5/Sen 1999.


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8

tions eectively limit peoples choices and

thus, their level o development.

The 2010 Report, Rethinking Human De-velopment, rearms the relevance o the

human development paradigm in several

ways. First, measurements o various di-mensions o human development or 20years suggest that the causal links between

economic development, democracy and

human development are complex and

not necessarily linear. Second, the increas-

ing uncertainty within the global nancialsystem and the growing challenges posed

by climate change reinorce the need or a

broader concept o human development.

Finally, the new 2010 Human Develop-

ment Index has been adjusted to take intoaccount inequality, bringing the question

o social exclusion to the oreront o the

global debate.

Social exclusion:denied participation

Social exclusion is seen in this report both

as a process and an outcome. It is a pro-cess that pushes certain individuals to

the margins o society and prevents their

ull participation in relevant social, eco-

nomic, cultural, and political processes.

As an outcome, it denotes the status andcharacteristics o the excluded individual.

Social exclusion status has many dimen-

sions poverty, lack o basic competencies,

limited employment and educational op-

portunities, as well as inadequate access tosocial and community networks and activi-

ties. Dierentiating between exclusion as

a process and as a status is important or

understanding the dynamic relationships

among the dierent dimensions o socialexclusion. A ocus-group participant cap-

tured this idea succinctly: When you work,you have riends. As soon as you lose your job,

you have no riends at all. 6

The concept o social exclusion has evolved

with the concept o social rights, rooted in

the idea o the European welare state. In

1974, Ren Lenoir, the Secretary o State

or Social Issues in the Gaullist Government

led by Jacques Chirac in France, in his studyLes Exclus dened the excluded as peo-

ple rom all social categories who are not

included in the social insurance systems o

the welare state.7

The concept has been urther adapted

and rearticulated over time. Within the dis-

course o citizenship, social rights and so-

cial justice, the status o being socially ex-

cluded is not merely understood as a lacko access to goods, but as a lack o access

to rights. I poverty is dened in relation to

income or material deprivation, social ex-clusion is dened in relation to social rights

such as the right to work, housing, healthservices, and education.8

For Sen,9 social exclusion occurs when one

does not have the reedom to undertake

activities that a person would have reasonto choose. The process o social exclusion

is intrinsically linked to the denial o ree-

dom. People may be excluded rom taking

advantage o an opportunity because o a

deliberate policy or practice in society (ac-tive exclusion), or as a result o a complex

web o social processes in which there are

no deliberate attempts to exclude (passive

exclusion).

There are many examples o both kinds osocial exclusion. For instance, unemploy-

ment experienced by a particular group

o people, such as migrants in their host

country, on account o specic legal restric-

tions, constitutes active exclusion. Passiveexclusion occurs when unemployment re-

sults rom a complex web o institutional

and systemic actors with no employment-

specic decisions involved.

The process o social exclusion, whetheractive or passive, may result in reduced hu-

man capabilities. Reduced capabilities in

one eld might be responsible or depriva-

tions in other elds o lie, urther uelling

the process o social exclusion. Sen reersto this as capability ailures and believes

that social exclusion plays an instrumental

role. Social exclusion is multi-dimensional,

including economic, social and civic di-

mensions. Deprivations in one dimension

can reinorce deprivations in another, andthese multiple deprivations can result in

social exclusion.

Social exclusion is not only characterized

by material deprivation, but by eelings oineriority, alienation, loss, and shame. Be-

ing socially excluded is both about status

and sel-perception. Social exclusion re-

ects the status o an individual vis--vis

mainstream society. This makes it muchmore relative than income poverty. How-

ever, similar to poverty monitoring, the

relative nature o social exclusion does notpreclude its measurement both in relative

and absolute terms.

6/UNDP Montenegro 2009.

7/Lenoir 1974.

8/Lister 2004.

9/Sen 2000.


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9

In essence, social exclusion can be dened

as the inability to participate in aspects o

social lie that people value and have aright to, be they participation in political

processes, labour markets, education and

health systems, or cultural lie. Exclusionis generated by the action (or inaction),

o a person, a group or an institution. Asan outcome, the opposite o social exclu-

sion implies social equality. The opposite

o social exclusion as a process is not just

inclusion, but expansion o opportunities

or participation in economic, social andcivic processes that are considered normal

in mainstream society. This makes the con-

cept closely linked to the human develop-

ment approach, and highlights the restrict-

ed reedoms and contributing actors that

might lead to social exclusion: discrimina-tory practices, unequal power relations and

institutional barriers that prevent access to

public services and political participation.

Social inclusion: expandingopportunities

Social inclusion is also a process and an

outcome. The European Commission de-

nes social inclusion as a process which

ensures that those at risk o poverty and

social exclusion gain the opportunities andresources necessary to participate ully in

economic, social and cultural lie, and to

enjoy a standard o living and well-being

that is considered normal in the society in

which they live. It ensures that they havegreater participation in decision-making,

which aects their lives and access to un-

damental rights (as dened in the Charter

o Fundamental Rights o the European

Union).10 This denition merges the desiredoutcome (well-being that is considered

normal) with the process through which it

can be achieved (opportunities or partici-pation).

The social inclusion approach acknowledg-es the need to oer those outside main-

stream society a greater say that is, great-

er participation as a means to achieve

well-being that is considered normal. Thus,

social inclusion is about redistribution osocial opportunities among all segments o

the population. It can be evaluated against

the yardstick o a quality o lie that people

value. It involves participation and integra-

tion into institutions and social networks.

Thus, social inclusion does not entail simply

a reversal o social exclusion in terms o sta-

tus. Elements o the process o social inclu-

sion that contribute to overcoming social

exclusion (like participation and involve-

ment) have intrinsic value. Social inclusioninvolves at least two steps. One is removing

barriers in a wide sense: barriers to participa-

tion and to access to resources and oppor-

tunities. The second is promoting a changein attitudes. Even though legal structures

might be in place, policies are needed to

cultivate solidarity, counteract entrenched

social prejudices, and encourage the partic-

ipation o individuals acing barriers. All are

important elements o the social inclusionprocess, which involves changing attitudes

towards what is accepted as normal. Suc-cessul social inclusion policies, supported

by eective implementation mechanisms,

have demonstrated that prejudices neednot be passed rom one generation to the

next. For example, in the majority o OECD

countries, social norms that had excluded

women or segregated minorities in the

1960s became socially unacceptable by theend o the 1990s.

Promoting social inclusion requires under-

standing the root causes o social exclusion,

such as discriminatory actions, ailure in ac-countability o the state and its institutions,

and structural ineciencies. Social inclu-

Box 1: UNDPs body o research on social exclusion and social

inclusion

This report has been enriched by an extensive body o research

produced by universities, institutions related to the European

Commission, as well as by UNDP:

Social exclusion through a human development lens has been

analysed comprehensively by the National Human Development

Report or Bosnia and Herzegovina (2007), Social Inclusion in BiH,Croatia (2007), Unplugged: Faces o Social Exclusion in Croatia,and Montenegro (2009), A Society or All and Kosovo (2011),Social Inclusion.

Methods or measuring and analysing social exclusion, inequal-

ities, and vulnerability have been developed in Poland (2007),

Social Exclusion and Integration in Poland: An Indicators-basedapproach, and the Republic o Moldova (2010), Approaches toSocial Exclusion in the Republic o Moldova: Methodologicaland Analytical Aspects.

The ormer Yugoslav Republic o Macedonia has produced regu-larPeople-centred Analysis Reports monitoring social exclusionand the quality o lie over time (2008, 2009 and 2010).

UNDP in Ukraine has produced a policy and institutional analy-

sis o social inclusion capacities, European Choice and SocialSector Institutions (2010).

10/European Commission

2004.


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10

sion also requires addressing them. For this,

the human rights-based approach can bean important policy tool (see box 2).

The EU has applied, promoted and ad-

vanced the concept o social inclusion

through direct policies in member states,

which have had a catalytic eect in the EUand beyond. The concept is also undergo-

ing a process o reinvention through the

Europe 2020 agenda, the EUs growth strat-

egy or this decade. The continuous evolu-

tion o the social inclusion concept reectsthe need or multiple deprivation analysis

beyond income, a step towards the human

development approach. This report con-

tributes to this conceptual convergence

between social inclusion and human devel-opment.

Social exclusion, socialinclusion and human

development

Social inclusion and human development

have both gained popularity in the last two

decades, but have largely evolved indepen-dently o each other, without signicant

cross-ertilization. Both are people-centred

concepts that governments increasingly

view as integral or addressing persistent

poverty and shortalls in education andhealth.

Human development is the goal o devel-

opment; social inclusion is the means toachieve it. Social inclusion involves remov-

ing the obstacles that prevent people rom

realizing their capabilities. However, social

inclusion is more than just lack o exclu-sion. Human development is only partially

achieved by decreasing social exclusion.

Achieving human development requiresdeliberate inclusive processes that expand

peoples reedoms and create an inclusivesociety in which diversity is a source o

strength.

The three concepts complement each

other. The human development para-digm adds value to social exclusion and

inclusion. Human development is both an

evaluative ramework as well as an agency-

driven policy ramework. Human develop-

ment as an evaluative ramework identiesshortcomings and inequalities in opportu-

nities or developing capabilities that con-

tribute to social exclusion. In addition, it as-

sesses the outcomes o the social inclusion

process through a variety o indicators. Asan agency-driven policy ramework, human

development aims to empower people to

pursue an improved social, cultural and

economic environment. It helps to identiy

approaches that address social exclusion.

It takes into account contextwideningthe ocus beyond the excluded population.

Furthermore, human development helps

to identiy structural ailures that preventpeople rom developing their capabilities.

(Figure 1.1 illustrates the relationships be-tween the concepts.)

Reversing direction, social exclusion and in-

clusion add value to human development

by providing a process perspective or, inother words, the agency o social exclu-sion (agents, groups, and institutions that

exclude) to the concept o human devel-

opment. It reinorces the notion o agency

that exists within the human development

ramework by examining through whatmechanisms, and as a result o whose ac-

tions, and why, people are excluded. Agen-

cy is thereore a key element in studying

social exclusion11 and the common denom-inator between social inclusion and human

development.

The social exclusion concept recognizes

the role o inormal and ormal aspects. In-

ormal ones include values, trust, inormaleconomic activities, social groups, amily

ties, or inormal networking. These aect

the process o human development as

much as ormal aspects do, notably institu-

tions, organizations, laws, and norms. So-

Figure 1.1: The relationship between human development,

social exclusion and social inclusion

Human development

as an evaluativeramework

Human development

as an agency-drivenramework

Social exclusionshortcomings

Social inclusionoutcomes

assesses

Social inclusionprocesses

enables

identies

11/Atkinson 1998.


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11

cial exclusion also provides a new perspec-

tive on human development by assigning

a central role to relational connections andunequal power relationships that are oten

at the root o every type o social exclu-

sion.12

According to Silver,13

social exclusionruptures the bond between society and the in-

dividual. Exclusion thus destroys the much-needed bond o solidarity and places some

members o society beyond the margins,

who then cease to be a cause or concern

or those inside. Over time, the enhanced

homogeneity and sense o shared identityamong the insiders reinorce the social ex-

clusion o those outside.

Monitoring social

exclusionDimensions o analysis

While rooted in the human developmentconcept, this report captures the three in-

terlinked dimensions o social exclusion:

exclusion rom economic lie, exclusion

rom social services, and exclusion rom

civic lie.

Exclusion rom economic lie can be seen in

inequities in assets, incomes and employ-

ment opportunities. Limited access to ma-

terial resources results rom exclusion in

this dimension. Once exclusion occurs, it islikely to contribute to urther exclusion, not

only in economic lie, but also in the other

two dimensions.

Exclusion rom social services results rom

unequal access to education, health care,housing, social protection and so orth.

People thus excluded have limited oppor-

tunities to enjoy the level o services per-

ceived as normal. These limited opportu-

nities can be the consequence o materialdeprivation, but they can also result rom

inadequate institutional rules governing

the supp

regional human development report on social inclusion

Documents